Laramide Resources Ltd. (TSX: LAM) is pleased to announce that it has entered into a letter of intent with Corona Gold Corporation and Teck Cominco Limited to purchase a 100% interest in the Thunder Lake West, Thunder Lake East, and certain adjacent properties in and around Dryden, Ontario (collectively the “Thunder Lake Properties”). The Thunder Lake Properties are contiguous to Laramide’s Goliath property in Zealand Township, Ontario. Thunder Lake West was actively explored by the Corona-Teck Cominco joint venture from 1993 until 1998 and work completed during this time included an underground decline ramp and over 250 diamond drill holes. In its 2006 Annual Report, Corona reported a non 43-101 compliant inferred resource of approximately 630,000 ounces of gold at Thunder Lake (3 million tons @ 6.5 g/t Au). The distribution paid to Corona and Teck will be in proportion to their respective interests in the Thunder Lake Properties.
The letter of intent calls for Laramide to purchase Corona and Teck Cominco’s interest in the Thunder Lake Properties by making staged cash payments of $18,411,687 and issuing Corona and Teck Cominco a 12.77% equity stake in a new gold focused company that will have the combined Thunder Lake Properties as its flagship asset (‘NewGoldCo”). All of Laramide’s other non-uranium assets will also be transferred to NewGoldCo which will become a separately listed public entity; these assets include the Lara polymetallic property in British Columbia, the NSR royalty on the producing Cerro Colorado gold mine in Mexico, and various shares in public and private entities held by Laramide including one million shares of Aquiline Resources Inc. (AQI-TSX). A minimum of $2 million in cash will also be transferred to NewGoldCo.
Laramide intends to file a prospectus with the provincial securities commissions in order to qualify the distribution of the NewGoldCo shares to Laramide’s shareholders under Canadian securities laws. The prospectus will provide a full description of the company, including its Board of Directors, management, properties and proposed exploration program. Laramide proposes to distribute a portion of the shares of the new company to its shareholders by way of a dividend.
All of the foregoing is subject to Laramide’s completion of a maximum 30 day due diligence review of the Thunder Lake Properties, at which time it must elect if it wishes to conclude the acquisition (the “closing date”). In the event that Laramide elects to complete the purchase of the Thunder Lake Properties, the cash consideration portion of the acquisition is subject to the following purchase schedule:
(i) $6,137,229 on the closing date;
(ii) $6,137,229 on the 60th day following the closing date; and
(iii) $6,137,229 on the 120th day following the closing date.
It is contemplated that NewGoldCo will finance the final cash payment to Corona and Teck and these funds will be raised in the new entity after the going public process is completed. Laramide intends to issue a press release announcing the dividend record date along with other details of the proposed new public company concurrent with a release announcing its decision with respect to proceeding with the acquisition.
The reorganization and spin-off of Laramide’s non-uranium assets is designed to improve the identification and valuation of specific Laramide properties, to enhance Laramide’s ability to divest specific properties through simpler corporate ownership, to enter into strategic joint venture agreements, and to enable Laramide to separately finance and develop its various assets, selectively reducing stock dilution.
Laramide is a Toronto-based resource company specializing in the acquisition and development of advanced stage mineral properties. Laramide has a diverse portfolio of assets, all of which are leveraged to commodity fundamentals. The Company’s lead project is the Westmoreland Project, Queensland, Australia. Laramide’s common shares are listed on the TSX under the symbol “LAM”.
For further information contact:
Marc C. Henderson, President
Toronto, Canada +1 416 599 7363
Peter Mullens, V-P Exploration and Corporate Development
Brisbane, Australia (617) 3831 3407
Or visit our web site at www.Laramide.com
This press release contains forward-looking statements. The actual results could differ materially from a conclusion, forecast or projection in the forward-looking information. Certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information.